You are on page 1of 47


The words corporate, social, responsibility suggests that, CSR covers the
responsibilities that companies or corporations have towards the societies within
which they are based and operate. From a practical perspective, CSR involves a
business identifying its stakeholder groups and incorporating their needs and values
within the strategic and day to-day decision-making process:
Figure 1.1: Brief Overview of Corporate Social Responsibility (CSR)

Corporate Social Responsibility is all

about setting Policies, Objectives and
Targets for excellence in three key areas:

Health & Safety Environment Social Community

Improving employee and Addressing Emissions, Energy Actively engaging with

supervisor safety through Efficiency, Climate Change, Employees, Neighbors,
Training, Best Practice and Biodiversity, Product Life-cycle Legislators, Regulators
Team Leadership & Innovation & NGO‟s

Then monitoring and verifying

performance and setting targets for
continuous improvements.

Finally, CSR Reporting to all stakeholders

Table 1.1:-Definitions of Corporate Social Responsibility (CSR)
Authors (date) Definitions

The idea of social responsibility supposes that the corporation has

McGuire (1963) not only economic and legal obligations, but also certain
responsibilities to society which extend beyond these obligations.

The firm‟s consideration of, and response to, issues beyond the
Davis (1973) narrow economic, technical, and legal requirements of the firm…to
accomplish social benefits along with the traditional economic
gains which the firm seeks.
CSR implies bringing corporate behavior upto a level where it is
Sethi (1875) congruent with the prevailing social norms, values and

CSR is the managerial obligation to take action to protect and to

Davis and improve both the welfare of society as a whole and the interest of
Blomstrom organizations.

Corporate social responsiveness is the capacity of a corporation to

Frederick respond to social pressure, the literal act of responding; or of
(1978) achieving a generally responsive posture to society.

The social responsibility of business encompasses the economic,

Carol (1979) legal, ethical and discretionary expectations that society has of
organizations at a give point in time.

Within the world of business, the main “responsibility” for corporations has
historically been to make money and increase shareholder value. In other words,
corporate financial responsibility has been the sole bottom line driving force.

However, in the last decade, a movement defining broader corporate responsibilities–
for the environment, for local communities, for working conditions, and for ethical
practices–has gathered momentum and taken hold. This new driving force is known
as corporate social responsibility (CSR). CSR is oftentimes also described as the
corporate “triple bottom line”–the totality of the corporation’s financial, social, and
environmental performance in conducting its business.


As the commercial sector increases its investments in corporate social responsibility
in its three usual venues (the workplace, the marketplace, and the community),
USAID is presented with the unique opportunity to create corporate partnerships that
can help expand, enhance, and sustain its health efforts in developing countries. The
following eight questions and answers provide basic facts for learning about corporate
social responsibility, and how it can contribute to furthering USAID’s health
While there is no universal definition of corporate social responsibility, it generally
refers to transparent business practices that are based on ethical values, compliance
with legal requirements, and respect for people, communities, and the environment.
Thus, beyond making profits, companies are responsible for the totality of their
impact on people and the planet.
“People” constitute the company’s stakeholders: its employees, customers, business
partners, investors, suppliers and vendors, the government, and the community.
Increasingly, stakeholders expect that companies should be more environmentally and
socially responsible in conducting their business. In the business community, CSR is
alternatively referred to as “corporate citizenship,” which essentially means that a
company should be a “good neighbour” within its host community.


Today, more and more companies are realizing that in order to stay productive,
competitive and relevant in a rapidly changing business world, they have to become
socially responsible. In the last decade, globalization has blurred national borders, and

technology has accelerated time and masked distance. Given this sea change in the
corporate environment, companies want to increase their ability to manage their
profits and risks, and to protect the reputation of their brands. Because of
globalization, there is also fierce competition for skilled employees, investors, and
consumer loyalty. How a company relates with its workers, its host communities, and
the marketplace can greatly contribute to the sustainability of its business success.


There are scores of CSR organizations and business associations promoting corporate
social responsibility, with a collective membership of thousands of companies -big,
small, and medium-sized – in diverse industries. In the United States, San Francisco-
based Business for Social Responsibility alone has 1,400 corporate members that
globally employ more than six million workers, and account for a total annual revenue
of US$1.5 trillion. In Europe, the London-based International Business Leaders
Forum counts 60 major global companies as members, and has established affiliate
resource centres in emerging market economies where there is a demand for corporate
involvement in social causes. In developing countries such as India, Indonesia, Brazil,
Egypt, and the Philippines, business associations dedicated to CSR exist. It can be
said that there are as many variations of CSR activities as there are CSR advocate
companies and organizations.


The business community can make tremendous contributions in promoting good
health and well being, especially if innovative CSR initiatives are undertaken in
partnership with government and civil society. In all but the most remote areas or
closed societies, business has massive reach and influence. For decades, business has
been engaged in charity, philanthropy, and civic activities including social
investments in health. However, oftentimes these investments were less than strategic,
and were not directed to real social change. Today, business understands that viewed
through lenses of “doing well by doing good,” CSR can be a revolutionary way of
contributing to systemic social changes in which investments can produce lasting
social benefits in the health arena.

There will, of course, be many challenges along the road to building health
partnerships with the private sector. USAID and the private sector have differing
cultures, professional goals, ways of communicating and governance structures. This
can make it difficult and complex to build the mutual trust and commitment needed
for working together. Also, from the business perspective, the public sector and
NGO’s often fail on business benchmarks–on-time and on-budget performance. It will
be necessary to overcome these cultural and operational differences, in order to lay
the groundwork for a strong and lasting partnership. Another challenge will be for
USAID and the private sector to find a common ground on which to work. This will
require resourceful thinking, as there are no “cookie cutter approaches” to
partnership–each partnership will need to be especially tailored to fit each private
sector company or organization. Historically speaking, it has often been difficult for
the private sector and USAID to find a standard contracting mechanism that can
facilitate a medium -to long- term partnership: each partnership will have its own
financial, legal and contractual frameworks. These new challenges will require
innovative solutions and creative, flexible approaches.


Both USAID and the private sector have global reach and resources. Through CSR
partnerships, these resources can be harnessed to promote a synergistic approach to
improving the health status of local communities. When USAID and the private sector
work hand-in-hand in addressing common health issues, the stream of benefits for
consumers can multiply. With leveraged resources, USAID will be able to extend its
family planning and reproductive health program efforts through work-based, market-
based and community-based initiatives in places where the private sector has a
presence. In turn, improved worker health can positively affect private sector bottom
line productivity factors such as absenteeism and employee morale. With CSR
investments in community health, the corporate brand and image are enhanced among
key stakeholders. To the extent that the health initiative relates to the company’s core

business objectives, the sustainability prospects of the health initiative are improved,
since some companies invest in a community for the long term. Successful CSR
partnerships can help raise awareness of public health issues among influential
corporate leaders. They can also help build American public support for international
health programs.


In developing countries where USAID has a presence, USAID primarily works with
host governments through a bilateral development framework. Therefore, if USAID is
to become involved in CSR partnerships, host governments must be supportive. The
specific role of the government in any CSR health partnership will depend on the
nature of the envisioned initiative. A partnership between the corporate and NGO
sectors would not necessarily need the government’s active involvement.
Nevertheless, the active cooperation of the health ministry or the local government
would be essential in enabling linkages with community infrastructures or public
health facilities. Whether or not the government is a full partner in the CSR initiative,
or whether its role in the initiative is formal or informal, keeping the government well
informed about the initiative enhances the environment for the initiative’s future
success. Governments have resources that can be leveraged, such as funds, staff,
expertise, and infrastructures. In countries where there are ongoing health policy
reforms, CSR partnerships would be a strategic way of implementing the action


On May 10, 2001, Colin Powell announced the Global Development Alliance as
USAID’s new business model and as the first pillar of its reorganization and reform
strategy. The GDA is based on the agency’s recognition that the dynamics of
international development are changing. No longer are governments, international
organizations and multilateral development banks the major sources of development
funding and expertise. Rather, in the last decade, the private sector, including the
corporate sector and private foundations, has had an increasing role in catalyzing
human and social development. Through GDA strategic alliances, USAID aims to

mobilize resources for addressing international development issues. Both GDA and
corporate social responsibility partnerships aim to stimulate new technologies and
investments by bringing in new actors and ideas to the development arena. Both also
recognize the corporate sector as a powerful force for promoting greater productivity
and social change. Corporate social responsibility partnerships can be an effective
vehicle for USAID missions to draw in new resources, new ways of reaching target
populations, and innovative program initiatives.


Being Green isn't just about putting potato peelings in the right bin and switching off
the gas there's also a human element. Otherwise known as corporate social
responsibility, it is viewed cynically by some, but by Rosalind Mullen who points
everyone towards 25 ways to be more socially responsible
Planting trees, climbing hills for charity, putting up bird houses Has the hospitality
industry gone mad in its quest to be good as well as green
According to Val Carter, corporate responsibility (CR) director at food service
company Aramark: "You instantly become a company that cares, and this is crucial to
help attract and retain staff. Most companies these days expect you to have a CR
policy - it could make the difference between winning and losing business."
But what about accusations that corporate social responsibility (CSR) is "fluffy"?
Alexandra Hammond, responsible business manager UK for hotel company Rezidor
Group UK, insists: "We do it because we depend on the communities we work in so
much - it would be reprehensible not to give anything back. Our staff live and work in
the community, so it helps to motivate them, too. Some things we do don't have a
financial return, because it is about giving something back."
Fund Staff For Voluntary Work
The 11-strong hotel group Red Carnation is in the early stages of introducing
volunteer days, which allow staff to take two extra paid days off each year to work as
a volunteer. Staff is encouraged to work for one of the charities that the group
supports, such as Starlight Children's Foundation or the Great Ormond Street Hospital
Tick Tock Club, but they can request that another charity be considered. One of the
first candidates has just completed a day at Action against Hunger.

Food service company Sodexo allows staff to volunteer for work with its main charity
partner, Fare Share, which has a five-year goal of helping 100,000 people by
providing more than 30 million meals, using 20,000 tonnes of redistributed food every
year. To date, Sodexo employees have provided 700 hours of volunteer support,
including members of the executive team, who spent a couple of days at Fare Share's
Bermondsey food depot earlier this year.
Support Fresh Water Schemes
In a bid to support a charitable supplier, Aramark generates sales for the One Water
brand through its contracts. Water puts all its profits into buying water pumps to
create clear water systems in Africa.
Elsewhere, Imago, the hotel and conference arm of Loughborough University is
Fairtra de-accredited and donates 5p from every bottle of water sold to help fund a
rainwater harvesting scheme in a small village in India.
Pass On Your Technology
Contract caterer Baxter Storey donates its old PCs to Computer Aid International.
This charity refurbishes computers and provides them at a low cost to schools in the
developing world, to charities and so on. The knock-on effect is that it reduces
potential waste.
Look After Employee Health
The consequences of ensuring that your staff eat well and live healthily are obvious in
both business and CSR terms.
Aramark's Business Action on Health team is part of a Business in the Community
(BITC) campaign. This campaign highlights the business benefits of better health at
work, and is trying to make reporting on workplace health issues commonplace in UK
It was also part of the subgroup developing the healthy eating toolkit, which has been
distributed to all FTSE100 companies.
Encourage Guests To Raise Funds
Many hospitality companies do this as a matter of course. Red Carnation hotels, for
instance, has for some years been asking guests to make a contribution of £1 per stay.
The company then matches the donation and has so far raised £38,000 for the Great
Ormond Street Hospital Tick Tock Club and more than £250,000 for the Starlight
Children's Foundation.

Campaign Sponsorship
Many events and campaigns could not happen without industry support. For instance,
Aramark is one of the sponsors of British Food Fortnight, one the largest volunteer
movements educating children about food.
Besides encouraging schools to invite chefs into classrooms to teach children how to
cook, it celebrates British food through a range of promotions in pubs and restaurants.
Set up a Charity
Company charities provide a structured and tax-efficient way to support local
communities and charitable causes.
Sodexo's registered charity, the Sodexo Foundation, launched the UK-based STOP
Hunger campaign to combat poor nutrition in local communities. It does this by
teaching basic nutritional cooking skills. Sodexo covers the administrative costs and
staff raise the funds. So far, they have raised upwards of £250,000 since the
campaign's launch in 2005, by being sponsored to jump out of aeroplanes or run
marathons. They also help to feed people in disadvantaged communities through
breakfast clubs for vulnerable children or by providing food for the homeless.
Further, the Baxter Storey Foundation became a registered charity in July. The
company supports four causes each year, including industry charity Hospitality
Action, plus issues close to its employees' hearts, such as local charities, sponsorship
of sports teams, supporting individual talent, and worldwide causes.
Funds are generated through initiatives such as the London-to-Brighton bike ride, the
Three Peaks Challenge, and in 2009 a Baxter Storey team will be undertaking a
London-to-Paris bike ride. Baxter Storey has also recently launched a "Penny-per-
cup" scheme with sustainable coffee company First Choice Coffee. During the first
year, the scheme is expected to generate £70,000 for the charity.
Deputy chief executive William Baxter says: "As an employer of nearly 5,000 people,
we want to make sure that we're not only supporting the big charities but also offering
a helping a hand to lesser-known programmes and initiatives that are close to the heart
of our employees."
Catering supplier Apetito has set up a staff foundation, which isn't a charity but which
does champion the charitable and voluntary work carried out by its staff and their
children, raising £50,000 in community donations since it began in 2007. The
foundation has recently donated £500 to aid the work of African Joy, which collects
second-hand goods to recycle and send to African schools and hospitals.

Recycle Office Supplies
Baxter Storey ensures that 100% of all disposable cups and packaging used by the
business are made from recycled, recyclable or biodegradable materials. All waste
paper is recycled and, at the end of 2006, the company changed from purchasing
virgin paper to 100% recycled paper, thus saving 2.4 tonnes of CO2 in 2007. Staff are
encouraged to print office paperwork on both sides of a sheet of paper and to recycle
Baxter Storey has also created printing hubs at its head office in Reading, reducing
the number of printers it uses by 50% despite office staffing having grown by 130%.
Support A Conservation Scheme
The Langdale Hotel and Timeshare Complex in the Lake District helped to found the
Tourism & Conservation Partnership (, a visitor pay-back
Langdale's guests have raised nearly £145,000 through an option to donate when
paying their bill. The North West Regional Development Agency matches the
donations made by guests, and the hotel also makes regular donations. Since being
established 14 years ago, the partnership has raised £1m.
Cycle To Work
Giving staff incentives to leave their cars at home is proving popular among
hospitality operators and suppliers.
As part of Foster Refrigerator's Green Week, staff were encouraged to cycle or walk
to work, or to car-share. Those who did were entered into a prize draw to win store
vouchers and eco-friendly products, such as an eco kettle. Since the launch of Green
Week last year, 40% of Foster's staff have now chosen to walk or cycle to work
Food service company Brookwood Partnership is providing cycle vouchers and
bicycle locks through a link with Faircare, which runs government-funded initiatives
to help employees buy bikes and equipment.
This scheme falls under the 1999 Finance Act for Tax Exemption and the
Government Green Transport Plan. Employees save as much as 50% on retail prices
through a salary-sacrifice scheme, whereby an amount is deducted each month from
their gross pay, which generates tax and NI savings for the employee and employer.
Brookwood allows the employees to benefit from the employer savings also. This
scheme is being relaunched, however, as initial take-up wasn't as high as was hoped.

Cut Delivery Miles
In 2007, Sodexo swept away 360,000 road miles by working with supplier Brakes to
reduce deliveries to sites.
The company imposed a minimum order requirement to discourage "little and often"
deliveries, complemented by the use of software to plan routes more effectively. It
represents a reduction of 400 tonnes of CO2 compared with the previous year.
Purchasing in bulk can reduce the number of containers used.
Work with Local Producers
Increasingly, large-scale purchasers in the food service industry recognise that they
can play a big part in helping to maintain our countryside by supporting local farming
communities, seeking products from sustainable sources and looking to reduce
environmental impact.
Sodexo Healthcare, for instance, has worked with NHS Shetland since 1992 and, as
one of the largest employers on the Shetland Islands, sources as much as possible
locally, buying from the local baker, fishmonger and dairy. In its Scottish
Government contracts, 52% of meat sourced by Sodexo is Scottish.
BaxterStorey sources all fresh produce from producers in the UK that are part of
accreditation schemes such as Red Tractor, Welsh Lamb and Lion brand, and is
developing its policy for sourcing fish that meet the Marine Stewardship Council
(MSC) requirements (see number 17, below).
Spread the Word in Schools
The Year of Food and Farming is a business-led campaign endorsed by the
Department for Environmental and Rural Affairs (Defra). It aims to help children to
find out more about the countryside and where their food comes from, through visits
to farms, cookery workshops in schools and other first-hand experiences.
Representing the hospitality industry, Harvester pubs and Toby Grill (both brands
belonging to Mitchells and Butlers) and Sodexo provide sponsorship. Sodexo runs
cookery workshops at about 500 primary and independent preparatory schools across
the country, reaching as many as 9,000 children.
Programme director Tony Cooke says: "There is irrefutable evidence that experiences
such as making bread have a profoundly positive effect on children's relationship with

Help People with Disabilities
A team from the Radisson SAS hotel in Edinburgh has been working with Enable
Scotland, a charity that helps people with learning disabilities. In a recent project,
staff from the hotel have been working alongside young men to help them find stable
jobs. One initiative has been to help them plant trees from seed in Edinburgh's
Craigmillar Castle Park.
Set Your Staff a Challenge
Many companies support their staff in fundraising activities. For instance, a team of
20 Aramark employees recently did the Five Peaks Challenge to raise money for
Childline and Macmillan nurses. This meant climbing the five highest mountains in
Scotland, England, Wales, Northern Ireland and the Irish Republic within 48 hours.
Aramark raised £41,500 from the peak challenge and a race day which took place
around the same time.
Share Your Swimming Pool
The Langdale Estate in the Lake District has shown its commitment to the local
school by providing private use of its pool every Thursday during term-time for
swimming lessons.
Tap into Eco-Friendly Workers
Stowe Mountain Lodge, a new US$400m ski resort in Vermont, USA, has employed
eco-friendly artisans to build furniture and design features. The artisans use organic
materials and environmentally friendly practices. In-room lamps, for instance, have
been custom-designed by Simon Pearce, who uses a waterfall to generate electricity
and to operate a glassblowing furnace and potter's wheel.
Purchase from Sustainable Stocks
To preserve fish stocks, the key is not to purchase any fish species on the IUCN
Red List of Threatened Species.
Compass has become the first contract caterer to be able to trace the fish on its menu
back to the boat that caught it and subsequent fisheries, through gaining Marine
Stewardship Council (MSC) chain of custody traceability certification. So far, five of
its contracts are covered by the certification.
Protect Wildlife
There are many initiatives to preserve wildlife in country properties where, arguably,
the issue of sustainability is overtaking that of ecology.

The Langdale Hotel and Timeshare Complex in Cumbria, for instance, is maintaining
bird-feeding stations, controlling grey squirrels and introducing red squirrel feeders,
and developing a bio-diversity management plan with Lancaster University. "We
don't have to do it," says general manager Nick Lancaster, "but our natural
surroundings are what bring the guests in the first place. If we are not prepared to
protect our surroundings, then we are not prepared to protect our business."
Serve Fairtrade
The hospitality industry has generally embraced Fairtrade products.
At the budget end, there are hotel companies such as Umi serving Fairtrade teas and
World Land Trust-approved Puro Coffee (every kilogram of Puro espresso sold sees
money given to buy and protect rainforest in South America), while the luxury end is
represented by hotels such as the Vineyard at Stockcross, in Berkshire, which has
taken on First Choice Coffee's Black and White automatic machines. These require
less training than other coffee equipment, and are thus suitable for a 24-hour hotel
Cavendish hotel in London's Jermyn Street uses Belu bottled mineral water, which
invests all of its profits in clean water projects, Fairtrade, Cafe Direct and Duchy
Reward Greener Guests
The Cavendish hotel on Jermyn Street, London, offers a 50% discount on valet
parking charges for environmentally friendly vehicles. The list of qualifying vehicles
is taken from the Energy Savings Trust and includes hybrid cars, alternative fuel cars,
LPG-converted cars and electric cars. Users of the latter are offered facilities to
recharge their vehicles.
The Sundial venues and events group, which has accommodation in Surrey,
Northamptonshire and Warwickshire, offers delegates who travel by public transport,
or who car-share, a credit of £5 to spend in the bar.
Use Green Service Suppliers
There is a growing trend for hospitality companies to check out the eco-friendliness of
their service suppliers. The Crowne Plaza London hotel was the first hotel to join the
Green 500 - an initiative launched by the London Development Agency for 500 blue-
chip companies in the capital. One of the hotel's standpoints is to take on only
suppliers that meet its own green credentials. An example is its car supplier, Green

Tomato Cars, which is an environmentally friendly private hire company that uses the
Toyota Prius hybrid and plants trees to make up for unavoidable emissions.
Educate Your Clients
To be fully green, the food service sector needs to ensure that its clients buy into the
environmentally friendly ethos.
Contract caterer Bartlett Mitchell runs green roadshows to explain to clients what the
company is doing to reduce its impact on the environment and to encourage them to
buy greener food and services. The roadshow team explains why the company prefers
to source organic or locally supplied food, and puts forward the benefits of using
recycled napkins and paper cups, starch plastic cutlery and so on in a bid to spread
sustainable, eco-friendly catering.
Educate Your Staff
Considerate Hoteliers says that hotels can reduce energy consumption by 20%
through regular staff training in the importance of being green. Staff can also take
what they learn into their everyday lives.
Sundial venues and events group is launching environmental seminars for its staff at
its properties in Surrey, Warwickshire and Northamptonshire. Kicking off the
initiative is George Martin, head of sustainability at Wilmott Dixon Construction's
rethinking business unit, who talks about sustainable development, changes in the
earth's atmosphere, legislation, sustainable procurement - and how all this could affect
the company.
Plant a Tree
While planting trees can't be an excuse for increasing carbon emissions, it does help
to mitigate pollution. Properly managed tree-planting schemes are good, no matter
what the motive.
Considerate Hoteliers linked with London charity the Westminster Tree Trust to
encourage hotels to sponsor a tree nearby in order to enhance the environment,
encourage bird life and help improve air quality.
The cost is £300 per tree, including planting, maintenance and replacement in the
event of failure. For an extra cost, the sponsor can have a brass plaque.
Participants include the Dorchester hotel in Park Lane, which has planted a London
plane tree opposite the hotel, and Luna House hotel in Belgrave Road, which
commissioned a tree outside the Passport Office. The Ritz is considering sponsorship
of trees in nearby Allington Street.

o To know different interpretation of CSR in small and medium enterprises of
o To know which type of social facility is provided in Ludhiana area.
o To assess how much money is spent by SMEs in Ludhiana.
o To assess the various reasons behind the CSR practises by SMEs in Ludhiana.
o To highlight the impacts of CSR practices on operations of the businesses of


CSR is performed by every MNC or big organisations as per the law every company
or organisation should involve in the CSR activities but still there is gap in this
activity because SMEs are still unaware of this CSR activities and also avoiding CSR
responsibilities. From the above reviews it shows that someone wants to improve their
reputation as good global citizen, someone wants to improve the global economy &
someone wants to maximise profits & then use some portion of the profits for the
benefit of society. So here the need of the study generates and an area is chosen
(Ludhiana) where a lot of SMEs are performing their businesses and by knowing their
view points this study is conducted.
Scope of the Study
The scope of the study is limited to SME’s of Ludhiana city only.


Research Methodology is a way to systematically solve the research problem. The
Research Methodology includes the various methods and techniques for conducting a
Research. “Marketing Research is the systematic design, collection, analysis and
reporting of data and finding relevant solution to a specific marketing situation or
problem”. D. Slesinger and M.Stephenson in the encylopedia of Social Sciences
define Research as “the manipulation of things, concepts or symbols for the purpose
of generalizing to extend, correct or verify knowledge, whether that knowledge aids in
construction of theory or in the practice of an art”.

Research is, thus, an original contribution to the existing stock of knowledge making
for its advancement. The purpose of Research is to discover answers to the Questions
through the application of scientific procedures. This project has a specified
framework for collecting data in an effective manner. Such framework is called
“Research Design”. The research process followed consists of following steps:

1.4.1 Research Design

A research design was the arrangement of conditions for collection & analysis of data
in a manner that aims to combine relevance to the purpose with economy in
procedure. Research design was needed because it facilitates the smooth sailing of
various research operations, thereby making research as efficient as possible yielding
maximal information with minimal expenditure of effort, time and money. The
present study had used descriptive research design. It involves collecting data through
self reports collected or through observation. Research described the variables already
exists and were not much under control. Descriptive Research: Descriptive research is a research where in researcher

has no control over variable. It just presents the picture, which has already studied. It
is a type of conclusive research, which has as its major objective the description of
something-usually market characteristics or functions. Conclusion Oriented Research: Research designed to assist the decision
maker in the situation. In other words it was a research when given our own views
about the research.

1.4.2 Sampling Design

Sampling can be defined as the section of some part of an aggregate or totality on the
basis of which judgment or an inference about aggregate or totality is made. The
sampling design helps in decision making in the following areas: - Sampling Unit: Who was to be surveyed?
The target population must be defined that has to be sampled. It was necessary so as
to develop a sampling frame so that everyone in the target population had an equal
chance of being sampled. Sampling unit of the study was small and medium
enterprises in Ludhiana city.

17 Sample Size: Sample size refers to the total number of items about which the
information is desired. The sample size of the study was 50. Sampling Technique: The sampling techniques used was non- probability.
The researcher has to decide whether the information was to be obtained from every
unit of population under study or only a portion of population will be used. In this
study convenience sampling had been used. In this type of sampling where the
researcher selects the sample according to his or her convenience.

1.4.3 Data Collection and Analysis

4.3.1 Data Collection: Information had been collected from primary and secondary
 Secondary Sources: Secondary sources collect data known as published data.
Data which were not originally collected was called secondary data. The first
step in any research was the collection of secondary data. In this project, data
was collected from internet.

 Primary Sources: Primary Data was obtained from respondents with the help
of widely used and well known method of survey. In this study primary data is
collected through questionnaire. Questionnaire was a list of questions given to
number of persons for them to answer. It secures standardized results that can
be tabulated and treated statistically. In this questions were presented with
exactly the same wordings and the same form to all the respondents.
4.3.2 Tools of Presentation and Analysis: In the current study, data has been
presented through figures and tables. After collecting the data has been analyzed
through charts, summated score and percentage to analyze the collected data. The data
should necessarily be condensed into few manageable groups and tables for further
analysis. Thus it helps to classify the raw data into some purposeful and useable

1.4.5 Limitations of the study

Some major limitations which were faced while preparing this project are as follows:
 Only 50 respondents from whom questionnaire was filled.
 Some persons showed unwillingness for filling the questionnaires.

 Study was conducted in Ludhiana only. So the results of the study may not be
applicable in other areas.
 Shortage of time for the detailed study of the project.
 Some persons showed a very rude behaviour while filling the questionnaires.
 Lack of awareness among the CSR benefits.


Small and medium enterprises (SMEs) play an indispensable role in triggering

economic growth and equitable development, particularly in developing countries.
Their business activity is generally performed closer to the stakeholders, allowing
them to be the firsthand recipients of expressed needs. Therefore by sheer proximity,
SMEs are continuously confronted to participate actively in the development of their
environment and act ethically. In the light of this argument, UNIDO entered into a
thematic cooperation with Swiss Development Cooperation (SDC) in May 2005, for a
project on SME cluster development and corporate social responsibility (CSR). The
main aim of the project was to explore whether and how UNIDOs approach could be
used to positively trigger the CSR related activities in the SME clusters

While clustering of SMEs is a prevalent phenomenon, their economic expansion has

to be prompted at best through co-operative actions. Since 1993, UNIDO has
pioneered an approach to support SME clusters. The emphasis of UNIDO’s cluster
approach is to provide assistance to facilitate cooperative action so that networks and
clusters of SMEs can expand through building synergies to better overcome
encountered limitations. The program has been drawing lessons from the experience
of successful clusters in both developed and developing countries, which have been
adapted to local conditions in countries such as Egypt, India, Nicaragua, Honduras,
Jamaica, Morocco, Nigeria, Ethiopia, Ecuador, Pakistan, Senegal, Thailand, Tunisia
and Zimbabwe.

Definition of SME’s

SME’s are defined in different ways in different parts of the world. Some define them
in terms of assets, while others use employment, shareholder funds or sales as criteria.
Some others use a combination of revenue and employment as a hybrid criterion. The
definition of SME has been a contentious issue in India. In fact, the term, the term SSI
(Small Scale Industry) is more commonly used to refer to SME‟s. In recent years, the
Government of India has sought to provide greater clarity in this sector by specifying
a clear definition. In 2005, the definition of a Small enterprise was expanded to
include a two category classification- a. Enterprises engaged in
production/Manufacturing of goods for any industry b. Enterprises engaged in

rendering/providing of services Enterprises in the manufacturing sector are defined in
terms of investment in plant and Machinery (excluding land & buildings) and further
classified into:-

Table 2.1:- Levels of Investments of Manufacturing Units

Micro Enterprises Investment up to Rs. 2.5 million

Small Enterprises Investment between Rs. 2.5million & Rs. 50 million

Medium Enterprises Investment between Rs. 50 million & Rs. 100 million

Source:[ Levels of Investments of

Manufacturing Units
Service Enterprises: defined in terms of their investment in equipment (excluding
land & buildings) and further classified into:

Table 2.2:- Levels of Investments of Service Sector Enterprises

Micro Enterprises Investment up to Rs. 1 million

Small Enterprises Investment above Rs. 1 million & up to Rs. 20 million

Source:[ Levels of Investments of

Service Sector Enterprises

UNIDO: SMEs need to be included in CSR activities

A UN body has asked India to modify a Rs 6,000-crore cluster development scheme

for micro, small and medium enterprises (MSMEs), making them shoulder corporate
social responsibilities, including environment-related issues.

The United Nations Industrial Development Organisation (UNIDO) suggested the

government that it should “suitably modify the existing cluster development schemes
by various ministries to include socially and environmentally relevant activities, thus
fostering inclusive growth”.

The government has made a provision of Rs 6,000 crore during the Eleventh Five-
Year Plan for improving infrastructure in different clusters of MSMEs. The UNIDO
said its recommendations on the corporate social responsibilities for the MSMEs have
been made based on studies done in five clusters. These are Ludhiana (knitwear
garments), Ludhiana (sports goods), Tiruchirapalli (engineering fabrication), Kalady
(rice milling), and Moradabad (brass metalware industries).

The UN strongly suggested involvement of the stakeholders like financial institutions,

credit rating agencies and companies or large buyers having SMEs in their supply
chain. Even business schools which train the future managers should place emphasis
on CSR.

“Most of the information and experiences available about responsible behaviour

across the world are about large enterprises. MSMEs have either been left out of the
CSR movement or their role has not been adequately appreciated,” it said.

According to estimates, there are about 13 million small enterprises in the country
providing employment to more than 40 million people. These enterprises contribute
45 per cent of industrial production and 40 per cent of the direct exports of the

SMEs Scope for CSR

Under the constraints that SMEs face, and tough market conditions, what scope is
there for SMEs to consider the business responsibility agenda?
Not surprisingly, most of the SMEs we spoke to as part of our research, were initially
confused as to what terms such as “CSR” and “sustainable development” meant and
did not often understand the connection between these concepts and their business.
However, it emerged as we went on, that although confused about “CSR”, companies
were nevertheless engaged in social and environmental activities and the broader
aspects of governance that we would classify under the umbrella of CSR activities.
These included environmental policies, waste reduction through recycling and support
for or management of conservation areas. Given the lack of time and resources

available to small SMEs, it was surprising how much engagement there was at the
community level.
New Updates on CSR
By Songbedna Bauri: Over the years, the concept of corporate social responsibility
(CSR) has evolved as a global initiative. The community outreach and sustainability
have now emerged as the standard practice for most of the businesses. It is believed
that the CSR activities are an important part of any organisation, especially when it
achieves a certain scale. It is also significant for the small and medium enterprises
(SMEs) that witness strong competition both at the global and domestic level from the
multinational companies (MNCs) on 21Jan, 2013-01-24.
Defining corporate social responsibility (CSR)
Corporate Social Responsibility are the practices and processes that businesses make
use to
 Fulfil the needs of stakeholders lower any social or environmental harm
 SMEs adopting CSR initiatives
In the past few years, SMEs have increasingly emphasised on strengthening their CSR
activities. It has been found that many of these small businesses have been adopting
prudent approach when dealing with CSR initiatives as meeting the costs acts as a
hindrance. There are certain simple and highly cost-effective means by which this
problem can be solved. Some of these include:
Find a person within the organisation who has the potential to drive the CSR
programme. Since most of the SMEs face difficulty in sparing a person whose sole
job is to run a programme, so it is possible to get those members of the company who
voluntarily want to take part in it. Their energy will be helpful in luring others to get
involved in this initiative.
SMEs can get an edge through community engagement. Ethical and socially
responsible firms have been found to be more attractive organisations. A proper CSR
programme, big or small, can be considered as an asset in the procurement process for
any company aiming to work in the central or public sector.
-It is important for SMEs to understand the true meaning of CSR programme and then
decide on the goals. Focus on the programme is essential and if any SME is
passionate about supporting education, theatre or local charities, then it needs to be at
the heart of the initiative.

The SMEs can take help from other organisations, which are ready to support
responsible business objectives. These organisations offer extra resource, opportunity
and numbers to help small enterprises get involved in these activities.
As from the above it is clear that many respondents believe that CSR is just the
corporate version of personal integrity. It is also felt that SMEs with clear goal, CSR
and strong governance enjoy a much clearer compass for their business. SMEs
account for majority of businesses and are also responsible for about 60%
of employment in India. If CSR gets built into their corporate DNA, it would further
strengthen the socio-economic profile of the country.

Table 3.1: Demographic Profile of Customers


Gender of Owner Male 40 80%
5-15 years 20 40%
Female 10 20%
16-25 years 10 20%
26-35 years 7 14%
Above 35 13 26%
Total 50 100
Under Graduate 20 40%
QUALIFICATION Graduate 15 30%
Post Graduate 15 30%
Total 50 100
Manufacturing 15 30%
Sports 12 24%
TYPE Chemical 13 26%
Leather 10 20%
Total 50 100
Below Rs. 50,000 20 40.00%
Rs. 50,001 10 20%
INCOME (Rs.) Rs.to1,00,000
1,00,001 to 5 10%
3,00,001 to 7 14%
Above 5,00,000 8 16%
Total 50 100
No. of Employees
Capital Per Year

Q1 Are you aware of concept of corporate social responsibility?

Table 3.2:- Percentage of respondents aware about the Theme

Responses No. of Respondents Percentages
Yes 40 80
No 10 20
Total 50 100

Figure 3.1:- Percentage of respondents aware about the Theme

Yes No

Analysis and Interpretation: From data and figure it has been found that 80% of
respondents are known to the theme of the social responsibility.

Q2. Are you currently indulged in CSR activities?
Table 3.3:- Indulged in CSR Activity
Responses No. of Respondents Percentages
Yes 40 80
No 10 20
Total 50 100

Figure 3.2:- Indulged in CSR Activity

Yes No

Analysis and Interpretation: From data and figure it has been found that 80% of
respondents are indulged in CSR activities and the remaining 20% are not..

Q3. Why do companies engaged in CSR activities?
Table 3.4:- Reason of engagement in CSR activities
Reasons Strongly Agree Neither Disagree Strongly
agree agree Nor disagree
1 2 3 4 5
CSR helps in 10 20
Ensuring Business
CSR helps in
Contribution to
CSR helps in
Ensuring benefits
to organisations
CSR helps in
Company Image
CSR helps in
Support to societal
and environmental
CSR forms part of 49 39 10 1
my company’s
CSR enables my 28 48 21 2
company to be a
good corporate
CSR ensures 24 34 33 6 2
development of
both my

company and the
community in the
long term

CSR helps in 17 47 22 10 3
CSR helps in 12 51 31 5

Analysis and Interpretation

5.7.1. CSR forms part of my company’s policy:- As total scores are 252 in
aggregate from which 49.49% respondents were strongly agree and 39.39%
respondents were agree and 10.10% respondents were those who neither agree nor
disagree and only 1.01% respondents were those who disagrees.
5.7.2. CSR enables my company to be a good corporate citizen:- As total scores
are 195 in aggregate from which 28.28% respondents were strongly agree and 48.48%
respondents were agree and 21.21% respondents were those who neither agree nor
disagree and only 2.02% respondents were those who disagrees.
5.7.3. CSR provides transparency in the areas of environmental impact and
human rights:- As total scores are 211 in aggregate from which 15.15% respondents
were strongly agree and 58.58% respondents were agree and 24.24% respondents
were those who neither agree nor disagree and only 2.02% respondents were those
who disagrees.
5.7.4. CSR enhances company’s corporate image:- As total scores are 200 in
aggregate from which 34.34% respondents were strongly agree and 39.39%
respondents were agree and 16.16% respondents were those who neither agree nor
disagree and only 10.10% respondents were those who disagrees.
5.7.5. CSR increase visibility as a community leader:- As total scores are 230 in
aggregate from which 14.14% respondents were strongly agree and 47.47%
respondents were agree and 30.30% respondents were those who neither agree nor
disagree and only 8.08% respondents were those who disagrees.

5.7.6. CSR ensures sustainable development of both my company and the
community in the long term:- As total scores are 225 in aggregate from which
24.24% respondents were strongly agree and 34.34% respondents were agree and
33.33% respondents were those who neither agree nor disagree and 6.06%
respondents were those who disagrees and only 2.02% respondents were those who
strongly disagree.
5.7.7. CSR is based on what employees want:- As total scores are 232 in aggregate
from which 17.17% respondents were strongly agree and 47.47% respondents were
agree and 22.22% respondents were those who neither agree nor disagree and 10.10%
respondents were those who disagrees and only 3.03% respondents were those who
strongly disagree.
5.7.8. CSR is based on what society wants:- As total scores are 171 in aggregate
from which 38.38% respondents were strongly agree and 51.51% respondents were
agree and 9.09% respondents were those who neither agree nor disagree and only
1.01% respondents were those who disagrees.
5.7.9. CSR is based on what consumers want:- As total scores are 227in aggregate
from which 12.12% respondents were strongly agree and 51.51% respondents were
agree and 31.31% respondents were those who neither agree nor disagree and only
5.05% respondents were those who disagrees.
5.7.10. CSR is a governmental/ business obligation:- As total scores are 190 in
aggregate from which 44.44% respondents were strongly agree and 31.31%
respondents were agree and 13.13% respondents were those who neither agree nor
disagree and 10.10% respondents were those who disagrees and only 1.01%
respondents were those who strongly disagree.
5.7.11. CSR contributes to welfare of employees:- As total scores are 240 in
aggregate from which 11.11% respondents were strongly agree and 53.53%
respondents were agree and 19.19% respondents were those who neither agree nor
disagree and 14.14% respondents were those who disagrees and only 2.02%
respondents were those who strongly disagree.
As from the above it is clear that CSR contributes to welfare of employees have
maximum scores so this shows that most of the respondents believes on the welfare of
employees and CSR forms part of my company’s policy have minimum scores which
shows that respondents believes on it at a low basis.

Q4 What are the impacts of CSR activities on the operations of their business

Table 3.5:- Impact of CSR Activities on the Operations of their Business

Impact Strongly Agree Neither Disagree Strongly
agree agree Nor disagree
1 2 3 4 5

It helps in 50 47 2
It helps in 29 49 20 1
It helps in 18 52 28 1
It helps in 13 34 37 15
It helps in 13 43 21 19 3

Analysis and Interpretation:-

5.11.1 Goodwill :- As goodwill scored 150 in aggregate from which 50.50%
respondents were strongly agree and 47.47% respondents were agree and only 2.02%
respondents were those who neither agree nor disagree.
5.11.2 Profits :- As profit scored 191 in aggregate from which 29.29% respondents
were strongly agree and 49.49% respondents were agree and 20.20% respondents
were those who neither agree nor disagree and only 1.01% respondents were those
who disagrees.

5.11.3 Sales:- As sales scored 210 in aggregate from which 18.18% respondents were
strongly agree and 52.52% respondents were agree and 28.28% respondents were
those who neither agree nor disagree and only 1.01% respondents were those who
5.11.4 Productions:- As productions scored 252 in aggregate from which 13.13%
respondents were strongly agree and 34.34% respondents were agree and 37.37%
respondents were those who neither agree nor disagree and only 15.15% respondents
were those who disagrees.
5.11.5 Demand:- As demand scored 253 in aggregate from which 13.13%
respondents were strongly agree and 43.43% respondents were agree and 21.21%
respondents were those who neither agree nor disagree and 19.19% respondents were
those who disagrees and 3.03% were those who strongly disagree.
From the above it shows that impact of CSR activities on the operations of businesses
of SME’s increases the demand very much because demand have maximum score
and least score is of goodwill.

Q5. Are you willing to continue engage in future CSR activity?
Table 3.6: Willing To Continue Engage In Future CSR Activity
Response No. of Respondents Percentage

Yes 30 60

No 20 40
Total 50 100

Figure 3.3: Willing To Continue Engage In Future CSR Activity






Yes No

Analysis and Interpretation: From data and figure it has been found that 60% of
respondents are willing to continue in future CSR activities and the remaining 40%
are not.


Following are the findings of the research conducted on SME’s of Ludhiana

 It has been found that 80% of respondents are known to the theme of the social
 It has been found that 80% of respondents are indulged in csr activities and the
remaining 20% are not..
 It has been found that 60% of respondents are willing to continue in future csr
activities and the remaining 40% are not..
 Almost everyone knows the theme of CSR.
 Meaning of CSR is takes place as care of labour, charity-welfare, business growth,
company image, religious sensitivities, support to society.
 There are still some persons who did not prefer CSR activities in their businesses.
 Both inward and outward social facility takes place.
 Most of enterprises expending a lot of money in the society for social benefits.
 Some enterprises are doing these CSR practices to support to society, to ensure
business ethics, to contribute to economic development, to ensuring benefits to the
organizations, to make good company image.
 Enterprises adopts the method of CSR activities by making partnership with
NGOs, by sponsoring to NGO’s, by providing health and safety programmes.
 There is honesty and quality in the contracts, dealings and advertisements of
business enterprises.
 Enterprises are ensuring clear supply, accurate information, labeling about
products and services, including its after sales obligations.

There was no homogeneous definition of the term Enterprise Social Responsibility
given by the respondents. Majority distinguishes taking care of the labour as an
enterprise internal action and externally infer as involving in community welfare.
Implementation of CSR activities is to the most part driven by the personal values of
the entrepreneur. Across all interviewed Micro, Small and Medium Enterprises,
Internal CSR activities are discernible by some preferences, such as labour welfare,
health care as well as Environment. However, Training and Development and
Transparency were least preferred. Across all interviewed SME’s, External CSR
activities are dominated by charity donations, and significantly behind health, and
environment in the Community in uniform distribution followed by education as well
as creation of social environment, which is not that emphasized. The Micro Small &
Medium Enterprises developed their own approach, and prove that CSR agenda acts
as a motivator internally and externally due to the religious sensitivities of the
Entrepreneurs and due to the care towards the labour welfare. Collective CSR
activities were initiated by the financially stronger enterprises in the SME, and
cooperated with the NGO/Local Charity institutions in their implementation and
expending a lot of money for the benefit of society. Involvement in CSR is for
ensuring business ethics, contribution to economic development, ensuring benefits to
organisations and support to society by that it affects the operations of the businesses
too like helps in increasing the goodwill of the business, demand of the products of
the business, production and sales of the business enterprises. So this shows that CSR
is playing a vital role in the businesses and it’s the duty of every organisation to do
some social welfares which will help in the development of the nation.

Following Recommendations have been suggested by me on the basis of the research
conducted by me:-
 There is need to guide every person of the society about the meaning of CSR.
 There is need to guide the ways through which SMEs can perform the CSR
 There is need to provide some tax benefits to SMEs on the social services by
that there should be more contribution.
 There should be proper camps regarding the social facilities like education,
environment, de-addiction, employment, etc.
 SMEs should be guided how CSR activities can help in the operations of their
organisations like goodwill, sales, demand, etc.


Crowther et al. (2009). Corporate Social Responsibility in Medium to Large

Enterprises by Social Responsibility, Research Network,
Davies et al. (2014). Corporate Social Responsibility in Small and Medium
Enterprises, Investigating Employee Engagement in Fair Trade Companies, Business
Fassins M. (2008) SMEs and the Fallacy of Formalising CSR, Business Ethics /10.1111/j.1467-8608.2008.00540.x
Fisher D. (2009). Applying Asset-Based Community Development as a Strategy for
CSR, A Canadian Perspective on a Win-Win for Stakeholders and SMEs. Business
Jenkins M., Heledd D. (2010). A Business Opportunity Model of Corporate Social
Responsibility for Small and Medium Enterprises
Kusyk M.(2007). Corporate Responsibility in Small and Medium-Sized Enterprises. A
Four-Cell Typology of Key Drivers and Barriers on Social Issues and Their
Implications for Stakeholder Theory, Corporate Governance: The International
Journal of Business in Society,
Mathur D. (2016). Perspectives of Small and Medium Enterprises for the Corporate
Social Responsibility in Jodhpur, International Journal of Research in IT,
Management and Engineering
Morsing et al. (2011) SMEs Matter for the CSR Agenda. Business Ethics
Nielsen L. (2012). A Case Study Among Danish Middle Managers, Business Ethics
Russo Y. (2013). Formal vs. Informal CSR Strategies, Evidence from Italian Micro,
Small, Medium-Sized, and Large Firms. Journal of Business Ethics


Q1 Are you aware of concept of corporate social responsibility?

Yes [ ] No [ ]

Q2. Are you currently indulged in CSR activities?

Yes [ ] No [ ]

Q3. Why do companies engaged in CSR activities?

Reasons Strongly Agree Neither Disagree Strongly

agree agree Nor disagree

CSR helps in
Ensuring Business
CSR helps in
Contribution to
CSR helps in
Ensuring benefits
to organisations
CSR helps in
Company Image
CSR helps in
Support to societal
and environmental
CSR forms part of
my company’s

CSR enables my
company to be a
good corporate
CSR ensures
development of
both my
company and the
community in the
long term
CSR helps in
CSR helps in

Q4 What are the impacts of CSR activities on the operations of their business

Impact Strongly Agree Neither Disagree Strongly

agree agree Nor disagree
1 2 3 4 5

It helps in 50 47 2
It helps in 29 49 20 1
It helps in 18 52 28 1

It helps in 13 34 37 15
It helps in 13 43 21 19 3

Q5. Are you willing to continue engage in future CSR activity?

Yes [ ] No [ ]